Nick and Mike discuss the latest in the world of poker including the inaugural Global Poker Awards, the latest news about online poker from the US, what to expect from upcoming online poker tournament series, and analysis of 888’s financial reporting.
Mike: Hello and welcome everybody to the Pokerfuse podcast. This is episode eight coming to you on March 14th 2019. I’m your host Mike Gentile along with my co-host Nick Jones. Nick how is the world according to Nick today? Yes, that’s weird. Okay.
Nick: The world is busy, is how my world is this week.
Mike: Busy is usually good, right?
Nick: Busy is good and honestly wondering even like this small niche of the poker world whether other journalists, other analysts are feeling as busy as we are. We might just be us but this is like our absolute jam-packed time of the year I think with all the financial reporting.
We are currently writing our annual report which is a tome, a weighty tome that we hope to have out in the next couple of weeks. It is busy, busy, busy.
Mike: Yes, I would venture to guess that that’s probably I wouldn’t say exclusive to us but a small number of people. I don’t know that there’s a lot of coverage of the financial markets of the greater iGaming companies out there from the poker side anyway.
I would venture to guess that a lot of this busy time is probably something that other people in the industry may not be feeling at this moment.
Nick: Yes with that said, we have got a yes, a pretty rammed show now so we’re going to try to get through and most of it isn’t financial it’s a lot of stuff that we are- Honestly, we haven’t had a lot of time to disseminate ourselves and we haven’t gone up on the sites quite yet.
A lot of content is going to come so we’re going to be talking off the cuff on quite a lot of these topics but yes I say let’s just jump straight in.
Tune in to a surprise announcement this week that we will see the inaugural global poker awards hosted in April time in Las Vegas. Mike, have you voted in the global poker awards yet?
Mike: I did. I filled out my ballot, I know that we’re restricted on what we’re allowed to talk about a little bit there. I did get a chance to talk with the president of the Global Poker Index Eric Danis himself. He cleared us on somethings that we can discuss.
Nick: Okay, well tell me then what’s the- because I haven’t voted yet I don’t know too much about it. Do you know what kind of the goals are with these global awards? I now understand that’s it’s an amalgamation if we have the American poker awards and the European poker awards a couple of years back so it’s a smashing together of those two I guess right?
Mike: Yes, that probably makes a lot of sense. The world is not just divided between the US and Europe for example, so that’s one reason. I think to bring everyone together under one house so to speak is probably a really good idea for poker.
Talking with Eric, there are some challenges in doing that such as timing or getting people to a single location. Having different focuses in different markets is also a challenge when you’re trying to put together an award that the judges or that the community can get behind as a whole.
Those are some of the challenges but overall I think it’s a good move.
Nick: Just to bring the listeners up to speed who might not be familiar at all with the previous awards shows. This is awards show presentation that will give out awards both to players and industry people and executives. It’s anyone who’s in the poker industry or consumers as well, they are all covered here.
Mike: Right, and it’s this collaboration between or combining of the American poker awards which I believe were four years in the making and the European poker awards which I think have over a decade of history behind them.
Nick: All right, yes. You’re actually you’re right. Yes. There’s going to be an award to like break out player, I remember that was a previous one and top player. In addition, is it like going to be the top poker site, do they have awards?
Mike: Well, I don’t think they are specific to online poker. I’d have to go back and actually take a look. I did vote but there were quite a few categories and I don’t remember them all off the top of my head.
I did talk with Eric a little bit and he did tell me that there is a lot of similarity between the categories this year and those that were last year. Obviously, there’s going to be some tweaks in there, but I think for the listeners that are interested if they just go back and take a look at the ones last year will see a lot of what they can expect to see coming in this year’s awards.
Nick: Yes, I’m just taking a look down myself the first time, it’s going to be awarding the best tour. It’s very much live focus. It’s event of the year, mid major circuit of the year, tournament director of the year, but then it does certainly go into the online in the sense of streamer of the year that might be a new category I guess because that’s obviously fairly contemporary thing in the industry. Then there’s some industry categories as well as journalists categories.
Talk to me a bit about the timing then because obviously, when I first saw this, my initial thought was like, “Oh, right, I have to get out to Vegas this summer during the World Series of Poker, because there’s an award show as well.” Then of course, you dig down and it’s in April, right?
Nick: It’s the next month. Very short timeframe. Did Eric explain at all why they’ve done it this way?
Mike: He did, he did. There were a couple of factors that were in play there. First being the time period of having it during the WSOP doesn’t really align with the award period. If we’re talking summertime for the World Series of Poker and the award period is for 2018, he just said that that did seem late to do an award ceremony for the prior year which, very valid point. He did say, however, that if there were other circumstances that if this really felt like the right move they would have made that work but the other thing that also came into play there was the facilities for which they’re holding the awards.
They have partnered this year with PokerGo and they will take place in the PokerGo studios. One of the things that Eric shared with me was that during the World Series of Poker the equipment that they would use to get the high quality video recording of the award ceremony is now going to be over at the Rio because they will be used to be tracking and filming the the World Series.
Nick: Are they expecting recipients of awards and an audience like a live audience for the ceremony?
Mike: I’m not sure that wasn’t something that I had discussed with Eric. I do know that he did say they are very happy to have the partnerships that they do have and those are the partnerships with PokerGo and with Poker Stars. He specifically talked a bit about the the PokerGo partnership in that one of the advantages of partnering with them is to be able to leverage their tremendous production resources. PokerGo also has a partnership with poker productions, which is Mori Eskandani. The advantages that they’re going to get as far as the quality of the production of the event, I think is a big win for them and obviously Eric was quite excited about that.
Nick: Global poker awards it’s less than a month away, is that right?
Mike: It is coming up, yes, I don’t have the date in front of me it was pushed back. In previous years it was in February so that lent itself a little bit better toward the award period being the previous year. I believe it was the week before the Academy Awards is when they used to hold it and this year it has been pushed back a bit. It has also moved from LA to Vegas, which was another change for the year and I think it’s a great stepping stone. I think a lot of things are coming into place. It’s moving in a positive direction, in my opinion, and I’m looking forward to seeing how they’re able to pull this off on such short amount of time.
Nick: Yes, it’s definitely something that we’ll be keeping our eyes on, more information will be released close to the time. We can talk a bit more about previous shortlist if they also the voting period is open now for the people on the panel. I know in the ballot there’s many, many options. It’s basically like a laundry list of anyone so presumably that’s going to be shortened down to a short list ahead of the awards and we’ll be able to talk about that and then the awards in a month’s time, something to look out for.
My favorite segment of the week because it means I can lean on Mike’s expertise, is the US News which is always generally extremely depressing. I think this week, Mike, you’re going to give us slightly more positive developments from your neck of the woods.
Mike: Yes. If I’ve given that impression that I have a negative outlook on the US market, that’s not completely accurate. I have been told that sometimes I need to balance my output because it’s not always reflective of my opinion. I think this is one of those instances.
Mike: Michigan, what we had this week was we had a hearing on online gaming bill in Michigan. Michigan, if you recall last year went quiet a ways towards legalizing online gaming including online poker. The legislation passed both the house and the Senate and made it all the way to the governor’s desk before he vetoed it at the last minute. This year, they’ve reintroduced legislation. It had its hearing in the house, and it for the most part was a very positive outcome.
Nick: Can you touch on briefly the reasons why it was vetoed last time and whether they are being addressed in this current push for 2019?
Mike: Well, I can tell you what they publicly stated, and that was that the governor back then, Snyder had indicated that he had concerns over cannibalization between online gaming and the state’s lottery program. I don’t know that there’s any way to really address that other than for legislators to come out and say, “That hasn’t been the case in any of the other markets.” We see no reason for that to be a concern, which was brought up in the hearing. Short of that, I’m not sure how else you can mitigate the concerns.
Nick: Michigan has been a hopeful state for a few years now. 2019 it’s just back on the table and its fingers crossed again I suppose.
Mike: If people would like to get a little bit more into the details of what happened in Michigan, I would suggest going back and looking through the Twitter feeds of Steve Ruddock and Brian Pempus they both live tweeted the hearing and had some interesting insights. You can check them out on Twitter, and you’ll be able to get a bit more detail.
Nick: Fantastic. We touched on West Virginia a week ago, and things are moving forward there. Was there any more details that happened?
Mike: Yes. West Virginia saw their bill advance, and it has been approved now by the Senate. The bill has made its way over to the governor’s desk. I haven’t checked today if he has put his signature to it to make it law, but we anticipate that that will be the case. As one of the local news outlets in West Virginia pointed out, the governor over there is at least part owner, if not complete owner of one of the state’s casinos. He stands to personally benefit from the expansion of gambling.
I would be surprised if we see a veto there. I fully expect that he will sign it into law and that West Virginia will become the next state to have legalized and regulated online gaming in the US.
Nick: Okay, fantastic. Of course we still have the shadow or the wire act interpretation but we’re seeing more and more pushback against that or more perhaps organization amongst states to fight that decision?
Mike: Yes. It’s moving its way through the courts. There are some states that are jumping in, they’re actually jockeying for position on who can be part of the lawsuit versus who provides briefs and such. A lot of that detail I’m sure is going to bore our listeners. I would say the other most significant thing that has happened in the US market this past week is the release of the revenue data from the New Jersey market. The most interesting thing that I was able to glean out of that data set was that last month in February was the first month of year over year growth for the entire market, in I believe it’s in eight months.
It happened, during the World Series of Poker last year we saw that happen and we saw it again happen this past month in February. That is in and of itself definitely a bright spot for the future of online poker in the US, because it shows that shared liquidity can boost revenues and could be beneficial.
Nick: It was only the Caesars’ licenses, which is WSOP. 888 on all American poker network. That was the only licensee to see growth year over year. Wasn’t it the other two which are segregated . Pokerstars and partypoker/Borgata, continued their decline.
Mike: What that shows is that the increase from WSOP/888 was so significant that it was able to carry the entire market to growth in year over year.
There have been a load of announcements this week that have come out around online poker tournament series. I see that there’s an entire laundry list here in the show notes, Nick. I haven’t read up too much on it. I’m hoping that you can give us some insights into what’s been announced and what’s coming up.
Nick: I think we and everyone else are trying to play catch up and keep up to date with everything that’s been announced. partypoker said they have two big ones coming up that have been announced in the last few days. Monster series, which is their low to mid-stakes tournament series. I think that’s something like $2.5 million guaranteed going off memory, which is equivalent to what they’ve run in the past. They’ve run Monster series three times a year, so that’s upcoming and it might be running now or if it’s in the next couple of weeks, I believe. Following that and a much bigger announcement is the next power fest tournament series, which is their big-ticket.
Also, run s three times a year for their flagship tournament series. That’s going to be running I think, starting in the end of April, which is a new slot for them, which is interesting because they’re announcing it— They’re not trying to schedule it the same time that pokers does it’s running SCOOP. They’re sticking their necks out and going it alone. We’ve seen some back and forth between operators in the past with PokerStars waiting later and later to announce their schedules. The other operators can’t piggyback onto them. It’s interesting to see partypoker getting ahead of that, and putting it out there. The next power fest is going to be 30 million guaranteed.
Mike: That’s an interesting point you bring up there because it seems like one operator or PokerStars specifically may be trying to prevent partypoker from piggybacking off of their schedule. I also read last week interview with Rob Yong that Lee Davy did over on calvinayre.com. I think he specifically stated that they are trying to keep away from doing that. I just find it weird that it seems like Poker Stars is trying to discourage that, yet Party is trying not to do it as well.
Nick: What I would say the Party is just accepting the fact that they can’t because PokerStars have done it. We saw I think it was last September partypoker canceled the last week of their tournament series then explicitly said that it was because PokerStars ran theirs shorter, and so they were out on the ir own. If you’re listening, if you have no idea what we’re talking about, broadly speaking, smaller operators can benefit when large operators run tournament series because a poker player, a big MTT player, if they’re playing a tournament on PokerStars they’d also fire up another operator to play .
It’s useful to run it in parallel because they one evening somebody can play tournaments across multiple sites. In some respect, that benefits everybody because everybody’s— I think in the past everyone has been happy to do that, but I think PokerStars is becoming more and more aware that operators like partypoker are trying to aggressively pursue their players, let’s say. I think they want to give them a free pass and want them to go there, which I think so. I think partypoker is just embracing that. This power fest-up coming $30 million guaranteed is depending on what you compare it to a slight decline or a large increase, so this is a new time slot for them.
Last May, they had a $40 million series, last September, they had a $60 million series. If you go back to January 2018, it was like a $15 million. They’re jumping all over the place with their series. It’s certainly a big number. It’s always worth pointing out with the partypoker ones that they will often change their weekly schedule tournaments and rebrand them as power fest tournaments, which is a smart idea because it makes a big number or a big number to advertise, but they’re obviously benefiting from the existing player base who would be playing these tournaments anyway.
Mike: That makes our job a little bit tougher because now we have to differentiate between what is actually the tournament series and what are the regular weekly tournaments because we’ve seen a trend where operators are tending to roll those numbers up into one. One specific number that designates the entire period instead of the actual tournament series.
Nick: Pokestars kind of potentially in response to that or trying to address that they will look at the total guaranteed across an entire month which might include SCOOP but also there are other tournaments. That’s just a new number that makes comparatives much harder. On top of that 888 have also announced their schedule for XL Blizzard. I’ll be honest right now I’ve got no idea how big it is or when it’s running. That’ll be interesting to see actually if it’s running at the same time the partypoker’s power fest is. This one’s tricky because this was announced that it was going to run two months ago but it was delayed because they have a new client coming out and there were apparently problems with that.
It still hasn’t deployed yet this new poker a client entirely. I don’t have access to in the UK. I believe is going to in some markets and it still hasn’t. I’m not sure if they are just running the tournament series regardless or they do plan to have it fully deployed but then I don’t know. The XL Blizzard normally runs in January. Normally it’s the turbo series and it coincides with PokerStars, turbo series or TCOOP I think that’s going to be running in the next month. That’s on the schedule. Literally like half an hour before we start recording this podcast PokerStars sent around a press release about their 13th anniversary Sunday million which listeners might remember from our first episode or second episode of this podcast. We talked about as little exclusive on Poker fuse. A couple of months ago that they were going to run this and that schedule has just been released.
Mike: Let me pull back the conversation a bit. I wanted to touch on something that you had said. You had talked about how operators sometimes tend to schedule these series close to each other in order to benefit from players playing as one another and I think we’ve seen that in retail locations. For example you’ll have a bunch of fast food restaurants all around each other because it tends to— The high tide raises all boats kind of theory. Back to that the interview that Lee Davy did with Rob Yong I remember him pointing out that one of the reasons that partypoker didn’t want to do that was because there was concerns over there not being enough money to support entry into both tournament series. I’m curious what has that been a concern that you’ve heard expressed before by other operators or what are your thoughts on that Nick?
Nick: No. It is not something I’ve heard expressed by other operators and that really surprised me. I don’t think that’s the case ultimately.
Mike: Interesting. Let me say this that Rob is a very interesting person. He’s got a lot of great insights. He’s actually very entertaining. I’ve seen a couple of interviews with him but from time to time he just comes up with things that I find are completely out of the field. Let me read this to you and get your thoughts on it. Maybe I’m making too much of it but maybe I’m not. I’m interested in your thoughts. This is a quote from the Lee Davy interview. He says, “I’m a partner with GVC. My agreement with them is to help them with partypoker because they don’t have the poker expertise within the company.” Then he goes on to say that Tom Waters is the managing director of partypoker. Mike Sexton is the face one of the founders of the original partypoker and we all know that John Duthy is the face of the live events. Is it just me or does he just rattle off these list of people that are within the company that have great expertise in poker?
Nick: That’s how I would read that. Yes.
Mike: It just strikes me as strange. Again Rob comes off as being very knowledgeable and very interesting and has good insights. It’s just from time to time I hear things coming from him that just don’t ring true with me.
Nick: That’s what you get when you get somebody who will happily speak his opinion and off the cuff you get a real mix. It makes the sense because he also said that the partypoker are planning to ban HUDs which is a whole new information that we would like to get confirmed with p artypoker before running it, because that’s brand new information and very interesting. That’s part y poker. Going back to the Sunday million, we should probably talk about the details of that, the anniversary Sunday million, because I don’t know Mike if you’ve read the PR that came through just before we hit record button?
Mike: I did not.
Nick: When we release this information, I thought this was interesting. A couple of months ago, they wouldn’t talk about the buy-in for what the 13th anniversary would be. In previous history, it’s always been $10 million guaranteed to celebrate once a year. It’s always of course, been a $215 event and we asked them what the buy-in would be, now it’s dropped to $109 you would assume the anniversary is going to be $109 as well. Severin Rasset at the time said it’s too early at this point to say what the buy-in guarantee will be for the anniversary event.
“After we’ve not run the $109 edition yet, we’ll evaluate performance and decide later what to do with the anniversary event. “ The anniversary event is going to be a $215 buy-in. What do you think that says about the performance of eight weeks of Sunday million at the $109?
Mike: If you look at the prize pool since they introduced the new buy-in at $109, I think it’s been declining every week. Is that correct?
Nick: Yes. I think it’s been declining every week. It starts off and it did I think 1.5x, it’s been dropping every week. It’s still over the guarantee. I’d be surprised if it drops below, because people are obviously aware there’s going to be an overlay, that’s what late registration is for but it’s probably at the levels that it was when it was the 215 buy-in, if not fraction lower. It’s always tricky because we’re going into the declining season, cash game traffic is dropping, it will continue to drop for the next few months.
Unless we have a nice comparative for the trend a year ago, the 215, it’s hard to draw too many conclusions. The fact that they’ve decided that the anniversary edition, which by the way, the guarantee, the press release said it will be an $11 million guarantee for this anniversary edition but the website says it’s a $10 million guarantee. We’ve asked for clarification on that. I’m just going to check my e-mail as we have not had a response back. It’s not clear what the guarantee for that is going to be, the same or fractionally higher.
The fact they’ve got a 215 suggests that they’re not confident at the 109 level to hit that 10 million.
Mike: I wouldn’t look at the ability to stay above the guarantee as a good indicator. I think there are a lot of factors over there, as you alluded to earlier that will play into that and help keep it above the guarantee. I think more telling is that the prize pool has declined every week since they introduced the new price point. As far as why is that happening? I’m befuddled by it. I would think that the lower price point would end up increasing the guarantee, but there is a point there where cutting the entry fee in half is going to have an adverse effect on the prize pool if you don’t continue to draw enough players.
Nick: It’s just a lot of players, isn’t it? It’s a lot of individual players who want to play a very long tournament Sunday night going into Monday morning, which it can run until six or seven in the morning European time. Whether they switch back, that’ll be interesting. It’ll be interesting to see how going back to the 215 for the Anniversary Edition, that’s an opportunity I suppose then to say, “So successful we’re returning to the 215. Our customers have spoken, et cetera.”
It’s a good time to switch back if they want an out, I suppose- Sorry go ahead.
Mike: I was just going to say, there’s still a bit of LOL sample size aspect to this. As you did mention before, we are in the declining period for online poker on a seasonal basis. To look at those those numbers from the Sunday million over the course of whatever it’s been, six weeks, eight weeks since they’ve introduced it, I think is very small sample size during a period where there’s other influencing factors. I would also caution that maybe not too many conclusions be drawn from that either.
Nick: Of course it’s not entirely guaranteed that they will cover the $10 or $11 million guarantee for the Anniversary Edition.
Mike: It’s not a bad thing if they don’t.
Nick: No it’s not. It’s always worth remembering that there was a one point. I’m just looking at the numbers, $1.2 million overlay a couple of years ago when they did it in 2018. They then followed up two months later with the take two edition, which did easily cover. Always with these things, it’s much down to the schedule for satellites and how well it’s promoted, rather than litmus test for the interest of the player base. That would be something to look towards. The Anniversary Edition will be, I’m just checking the dates here, April 14th. One month today. Yes, it’ll be very interesting to see what the turnout is for that.
Mike: Do you happen to have the dates of previous Anniversary Editions?
Nick: No. [laughs]
Mike: The reason I was asking is because it seems to me that they were earlier in the year. I remember the 2018 and where they missed it may have coincided with the Super Bowl, which is really in a different period than April when it comes to the seasonal online poker liquidity or traffic.
Nick: Yes. You’re actually right. You think being that it’s an anniversary, it would be the same time of year. I’m just going to check the overlay one. It was February time. It was February 5th. It was when we wrote our article on the overlay.
Mike: Right. The difference between February 5th and April from the seasonality of online poker is huge in my opinion.
Nick: Yes, it’s true. Although it’s the ramp up to SCOOP as well. That always does well.
888 was the last of the publicly traded big online poker operators to announce their financials for end of year 2018. Nick, what were some of the highlights from their reporting, and how do they compare to the other big hitters?
Nick: If we focus specifically on the online poker side of things, there probably weren’t any highlights at all for 888. Just remind ourselves where we were last week. We talked about PokerStars, which saw a very fractional growth in online poker for the entire year of 2018. partypoker saw a significant growth in their revenue, thanks to the investment there. Unibet have also seen big growth, although from a small base. 888, on the other hand, saw big declines. I think for the whole year, online poker revenue dropped 37%.
Mike: Wow, how much?
Nick: Yes, 37%. In fact, the numbers get bleaker when you look at the halves. In H1, their declines was something like 29% or 30%. For H2, it almost halved, their revenue almost halved from something like 36 million down to 18 million for the second half of 2018.
From a revenue perspective, very disappointing for the company.
Mike: 888 also does casino and sports. How how did those verticals perform? I’m curious.
Nick: Casino grew, it continued to grow by, I think it’s either sixth or seventh year, the casino is growing. Casinos by far the largest component of 888 for a company. Sports, I think was flat or slightly fractional growth. It’s interesting for 888 as a company. Historically, poker has been very important from a pure revenue perspective. Historically, it has always been the second largest vertical for the company, which is uncommon.
If we look at something like partypoker, their parent company, GVC, poker has always been pretty small, and it’s under 10% now. Sports is massive, casinos is massive.
Whereas 888, sports is actually a new vertical for them. They’ve only had it three or four years. They’ve always been casino and poker, and poker has been 20%, 30% of their revenue historically. It’s a very important part of their business. It’s nailed down to something like just above 10%. I think in H2, it was 8% of their revenue. It’s a huge drop off in their online poker revenue. A large part is because of, I think the competitors have taken a part, particularly partypoker has been successful in pulling players away from their product.
Mike: Yes, we’ve seen a large investment in both online and live poker from their competitors, from party and from PokerStars, where it doesn’t feel like we’ve seen the same level of investment coming from 888. I do find it curious that their other verticals are still performing well.
I look back at when PokerStars announced their results last week, and one of the things that Rafi said, Rafi, CEO, Rafi Ashkenazi. One of the things that he said during the conference call is that, for the International segment, that poker is their main acquisition channel and the key driver for other verticals. I would expect that that would also be the case for other companies and that’s why I find it surprising that they had such a decline in poker and yet the other verticals didn’t experience the same downfall.
Nick: It still is the case, 888 said explicitly the poker is very important. It gets a lot of time on the analyst court because it is such an important vertical for them for customer acquisition. They said it accounts for 25% of the customers they acquire come through the poker client.
It’s very very important that they do. They did stress that they are then cross -sold into the casino, and if you account for that then the customer yield doesn’t decline anywhere near as much but it’s important for them to be maintaining a healthy online poker ecosystem to offer that product because it is bringing in customers and they do want to continue offering that product.
It is a big problem for them. In my opinion the poker clients find that software is, they’ve got a fairly solid base there. They’ve obviously got an iconic brand, they’ve just taken the foot off the gas in the last year to year and a half, in terms of live tournaments, online tournaments, promotions, software updates.
Mike: Did they give any indication of things they might be doing going forward to try and turn this around?
Nick: Well, that’s very interesting because after the disappointing first half to 2018, they talked a lot about that and a lot that they were doing internally to improve the product they we’re going to launch this new client , poker 8, it was going to be the biggest client in eight years or something, the biggest upgrade they’ve done in eight years. They were going to launch this new game called Pick 'em 8 which is going to be really important.
You go back prior to that. The end of 2017, they were talking about blast and snap and all these games and how this product innovation is important. That tone has really shifted now. What they talked about was these external factors and I want to give a shout out to Josem on Twitter, Michael Josem. We had a bit of back and forth. I was tweeting during the 888 investors call. He made a very good point that everything that they were saying now was about these external factors that were going to benefit the company like European shared liquidity, for example, there’s going to be more stability in the UK.
They didn’t really talk at all about- they might have mentioned the new client but it was more about their fortunes were going to change externally than what they were doing internally, which in my opinion is not the right way forward. They have a lot to do internally to compete if they want to compete against Partypoker, even Unibet. You consider just like Run it Once . PokerStars will always have the liquidity and that will last them for a long time, because whatever they do wrong in the eyes of the poker player, they will always have the biggest tournaments every week, the biggest tournament series and that will last them a very long time.
888 doesn’t have that and they need new products or they need new promotions or they need something to give players a reason to play there over other sites. They lost that fast in 2018 and 2019 they need to do something special.
Mike: They’re well positioned in the US. As we talked about earlier, the All-American Poker Network is the only online Poker Network that has shared liquidity currently in the US. Their position there seems quite well, but if you look beyond the US, they had some bad luck with European shared liquidity. They put a lot of their eggs into the Italy basket which has yet to materialize. It’s the tale of two different companies. I’m not sure how they’re going to balance that going forward.
Nick: That’s exactly right. On the European side, they were unfortunate that they launched in Italy ahead of European shared liquidity and then of course Italy didn’t sign the agreement [Eratum – they did, but didn’t move forward] . They now said that they’re considering re-entering France, which is very interesting. That’s obviously a tough market. They are soon to launch in Portugal and that was something else that was highlighted because as it stands right now, they are the only major company who doesn’t have Spain sharing liquidity with another country.
They will do soon with Portugal and that will be a big benefit to them because only PokerStars is in Portugal at the moment. That will be an alternative choice for consumers. The US example is a good one in that. They’ve clearly seen the value in online poker as a customer acquisition channel. That’s going to be a big platform for them in the US. They have that huge advantage that they have that cross-border shared liquidity. Obviously the wire act interpretation has been a huge blow to them. It came very soon after they announced this multi-million dollar acquisition to have full control over the all American poker network, again, must have been a bad luck there that they were sidestepped, they see this as a very important platform to acquire customers and get it into their brand and into their funnel for casino. That it surprises me that they allow their platform to lapse and their promotions and tournaments to lapse and they don’t see the investment opportunity to keep players in that economy.
Mike: One thing that stands out to me when I look at their success in the US is it doesn’t seem to me that they are showing the success based on their own brand recognition, it seems to me like they are— I wouldn’t say riding the coattails, they are benefiting from their association with wsop.com and I wonder if they can take that brand recognition from WSOP and try and put that into other markets outside the US and perhaps they may see some uptick from brand recognition in that way.
Nick: I don’t know if it’s been picked up in the audio at all, it sounds like you’ve got quite a storm brewing outside your window.
Mike: [chuckle] Well, if you can hear it then, yes, I guess it is getting picked up. Yes, it’s really getting dark here of, I’m hearing the rain come down, we typically lose power in this part of my little world when we get big storms, maybe that means it’s time we should wrap up.
Nick: Yes. I’m saying let’s rush through, I want to hit the stop button on the recording as soon as possible.
Mike: All right, well, I guess that’s a wrap for it us this week. Thanks everyone for tuning in and we’ll see you next time.